survey: busy season goes sour

february confidence melts under the harsh realities of march.

by 卡塔尔世界杯常规比赛时间 research

remember those heady, sunny, optimistic days of january? despite the government shutdown, cpas and tax practitioners—more than a third of them, anyway—foresaw a productive and profitable busy season. they saw a swelling clientele and revenues to follow suit.

more on busy season: tax refunds up 1.7%|   lessons learned: how the federal shutdown hit busy season 2019 | lessons learned: how the federal shutdown hit busy season 2019 | refunds rebound, up 1.3% from last year | tax refund fury roils busy season | tax pro efiling drops 12.5% after shutdown

but then, apparently, something happened. the tides turned. the season soured. suddenly, as february turns to march, the responses to the 卡塔尔世界杯常规比赛时间 busy season barometer readings are tipping into pessimism. join the survey. get the results.

around the time the government shutdown was ending, 36 percent of respondents told us they expected a somewhat better or much better season. now, just a few weeks later, that number is down to 30 percent— a six-point drop in as many weeks.

even expecting a season “about the same” as last year turned out to be too optimistic for some. back when the season was just getting underway, 32 percent saw little change ahead, but now that more responses are in, that number has dropped by a third.  their ranks are down to 21 percent.

back then, only 32 percent sensed a worse season coming up. now it’s—yipes!—49 percent. those expecting a much worse year have more than doubled, from six percent to 14 percent today.

what happened?

well, it seems a lot of practitioners are getting clobbered by

• the persistent mysteries of the tax cuts and jobs act,
• the sluggishness of the irs,
• the tardiness and tightfistedness of clients, and
• software

or, as one respondent, suffering a much worse year, summarizes it so well, “software! new tax law changes! refunds much less!”

“the slow start led to many forms not being approved for electronic filing,” vail, ariz., enrolled agent steve katz says, “the season itself started two weeks later than normal, and the slowness of the irs and the states in getting ready for it compressed the season even more. there are still returns i cannot e-file because the irs and states have not yet accepted all the forms. normally, tax season is three and a half months long and we are stressed as it is to complete everything by then. this year it’s even shorter, with practitioners, the irs and the states having the same jobs to do only with a month less time.”

the tcja

one anonymous respondent, reporting a somewhat worse year, attributes the downturn to “added complexity due to all of the new disclosures required due to section 199a and changes in accounting methods for accrual to ash and unicap.”

forms and instructions not ready but that part is congress’ fault. that puts a big crunch on the last 2 weeks. in my years of practice, i have never seen so many irs notices that are just plain wrong in calculation and in law. some irs employees are great people and some are just out to make life difficult for taxpayers.

bernard t. wildenberg, in mamaroneck, n.y., is having a somewhat better year, but he says, “more people are confused about how to handle the new laws.”

the irs

we can’t blame the irs for what congress has handed it (not to mention taken away from it). but the s still stands for service, and many practitioners are finding the service a little slow this year.

joyce swanson, owner of an omaha firm bearing her name, expects a much worse year, and this is why: “forms and instructions not ready but that part is congress’s fault. that puts a big crunch on the last 2 weeks. in my years of practice, i have never seen so many irs notices that are just plain wrong in calculation and in law. some irs employees are great people and some are just out to make life difficult for taxpayers.”

the clients

respondents tell us that some clients are coming in early due to anxiety over tcja—needless anxiety, some tell us, driven by media reports. others say clients are late because they couldn’t get answers or the right forms because the irs was closed. many fear that clients will suffer sticker-shock when they find out that fees are higher because the simplified tax returns are more complicated.

gretl siler, of lighthouse cpas in panama city, fla., has most of those problems plus another.

“for us it is probably the impact of hurricane michael and that almost none of our clients know what all their hurricane losses will be 4 months after the storm,” ms. siler says. “we are 40% behind normal and the majority of our clients could care less when their tax returns are completed.”

nancy hasbach, with hasbach and seiler in san dimas, calif., is having a somewhat worse year because of taxpayer anxiety.

“results are worse,” she says. “people are coming in earlier because they are worried how it will come out and are not happy because they owe or have greatly reduced refunds.  the withholding on wages caused a huge problem.”

tech

the problem this year hasn’t been computers on the fritz. it’s the delay in updated software to account for the tcja changes. but software companies seem to have solved the problem as best they can. as one anonymous respondent says, “software was later but overall, seems to be working well.”

the jury’s still out on how the rest of the busy season trudges into crunch-time. maybe the irs will answer questions and make decisions quickly. maybe everyone will get comfortable with the new tax regs. maybe clients will be delighted with their refunds. and maybe this will turn out to the be the year everyone was hoping for just a few weeks in the past.

and maybe you have an opinion on busy season in your neck of the woods. the busy season barometer is still looking for comments., and your two cents would be of interest.

posted on march 13, 2019